I remember as a kid having a discussion about decision making during which the man I was speaking with said, “always go with your gut!”  As a more logical person, that didn’t resonate with me. It seemed to me that more information – more data – should be required to make a decision.   Further, as a leader, running companies, leading people, and needing to make decisions that impact my companies,  my life and the lives of those on my team, is making gut decisions practical?

Realistically, I have been in situations where I ended up making decisions with my gut, some of which turned out well, some, well, not so much.

(Ingrid Ahumada of eScalable Digital and I had a conversation about this some time ago on the AOTC podcast, which you can see here.)

I want to begin by saying that BOTH APPROACHES TO DECISION MAKING ARE IMPORTANT! But as you can imagine, there are appropriate situations during which one is a more effective tool than the other. Therefore, it is important to weigh each situation before deciding which approach to take. In our own work, when designing a project, we incorporate both methods into our process because, as you will see, both can add value to the organization.

Going with your Gut Decision Making

Going with your gut will often allow you to make decisions quickly. You can draw on your education, experiences and perhaps your feelings to make a decision. For the deeper thinkers in the room, those who rely on data, they might be thinking, “while the first two options might make sense, but trusting your feelings is completely subjective and cannot be measured.”

I can’t say I disagree. However, here are five scenarios when thinking with your gut is the better option:

1. Expedient Requirements: I worked in the restaurant industry for a long time. The environment is one that is constantly chaotic, and things happen that would be exceedingly difficult to plan for. As a result, relying on my gut allowed us to make decisions quickly and keep things moving without interrupting the guest experience or impeding our own operations.
2. Brainstorming Sessions: What I love about brainstorming is the raw thinking that often takes place. If participants are able to think freely without their ideas being judged, we can often leave the session with ideas we had never considered.
3. Building Your Leadership Brand: Sometimes what makes for great leadership is the willingness to say, “let’s try this…” (in the south, it might be, “hold my beer real quick…”) and making one of those gut-level decisions that puts a company on the map.
4. Navigating Chaos: Going through COVID-19 as a business owner was the epitome of chaos.  I would say that the restaurant was what I would call “controlled chaos,” and an environment that I honestly thrive in. But COVID-19 presented a series of chaotic situations that required quick decision-making for which there was little-to-no data, education or experience to ensure that businesses stayed in business.
5. Authenticity: There have been many situations in which while I didn’t have all of the information, I knew what my values were and was able to make a decision that was true to my mission, supported pursuit of my vision and was aligned with my values.  There was nothing else to think about it. Joe Yazbeck discussed this in our podcast, “What You Need to Know About Authentic vs. Synthetic Branding.”

Data-Drive Decision Making

On the other hand, we have your data-driven decision-making, which will require more engagement, more data, take longer and risk “analysis paralysis.”  Even with this approach, we can often only achieve 80% certainty (not always the case, but the last 20% may make much less of an impact than the 80% so you will have to confirm whether it is worth it.) However, one can achieve greater certainty with the decision.

Situations that would benefit from data-driven decision making.

1. More Informed Decision-Making: when making financial decisions for my company, I absolutely need to have accurate information to do so. Going with my gut can cost the company greatly.
2. Data-driven Performance Enhancements: When looking at a process, when looking at a marketing campaign, if we capture the data properly, we can make changes in the process or campaign that would enable better performance.
3. Accountability and Goal Alignment: If we are using data to drive our decision-making, we can track team performance, share it with the team and get their buy-in to collaborate to pursue the company objectives collectively.
4. Task, Project, and Team Ownership: If team members understand how their contributions impact the organizational goals, they can choose to make decisions and choices that will contribute to those goals.
5. KPI Tracking for Growth: with data about the organization in hand and the ability to see individual KPI performance and sharing that information across the team builds trust, allows people to understand the impact of their activities and those of their team members to achieve company growth goals.

As a leader knowing when to use the ideal approach to decision-making, whether exclusively “going with your gut” decision making, data-driven decision making, or understanding that for a particular situation, a blend of both, is critical to maintaining business continuity. All stakeholders are dependent on us as leaders to make the right decisions for the company so that they can have some level of predictability. One could argue that selecting which approach to take in decision-making is like an art form and one where only experience will allow you to know which approach to lead with and when to use both. As a leader, I would recommend learning to be confident and comfortable in using both.

Aepiphanni is a Business Consultancy that provides Advisory, Management Consulting and Managed Services to business leaders and entrepreneurs seeking to improve or expand operations. We are the trusted advisor to those seeking forward-thinking operational and strategic solutions to help them plan for and navigate through the challenges of business growth. Learn more about us at https://aepiphanni.com or register for a complimentary discovery session at https://coffeeandaconsult.com.